You can use any yarn that you please for this pattern, though I have learned through experience that knitting toys in a tight gauge with bulky yarns can really do a number on your hands, therefore I would recommend a sport/DK or worsted weight yarn, using needles that are 2 - 3 sizes smaller than what your yarn calls for.

The safety eyes that I used for these guys are 6mm black eyes. A similar effect could be achieved by embroidering the eyes with black yarn.